BusinessTimes
HONG KONG: Fund houses managing US$4.2 trillion (US$1 = RM3.45) of investments turned negative on global stock markets heading into the third quarter, opting for higher exposure to safe-haven cash and bonds, according to a survey by HSBC released yesterday.
The survey of 12 international fund managers taken in early August, including the bank's own HSBC Global Asset Management unit, found the firms were hit by US$28.5 billion in net outflows in the second quarter, with investors yanking an estimated US$50 billion out of equity funds.
The outflows from equity funds were partly offset by net inflows of US$15 billion into balanced funds and US$11 billion into money funds, the survey found.
Asked what asset allocation strategy they would adopt in the third quarter, 44 per cent of managers said they were underweight equities, up from 10 per cent in the previous quarter. Just 22 per cent were overweight and 33 per cent were neutral.
By comparison, no managers surveyed were underweight cash or bonds. Some 44 per cent were overweight bonds, up from 20 per cent in the previous quarter, and 38 per cent were overweight cash, up from 30 per cent.
Funds investing in Asia-Pacific markets outside of Japan were hit particularly hard by redemptions in the second quarter, posting an estimated net outflow equivalent to 20 per cent of sector funds under management. This compared with net inflows in the previous quarter.
Fund managers participating in the survey included AllianceBernstein, Allianz SE, Baring Asset Management, Deutsche Bank, Fidelity Investment Management and Franklin Resources Inc.
Invesco, Investec Asset Management, JPMorgan Chase & Co's JF Asset Management, Schroders plc and Societe Generale also participated. - Reuters
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